There is a lot to balance too. So far, the Covid-19 support package is expected to cost the government more than £300bn for this financial year alone, according to the BBC.
So, what is likely to happen? Well, expect taxes to rise. It just depends which taxes and by how much. Given the Conservative manifesto for the last election promised it would not raise income tax, VAT or national insurance, there is little wriggle room unless these promises are set to be abandoned.
Some of the cost could be clawed back from government spending, or there could be more borrowing to cover the cost of borrowing, but that could easily turn into a rabbit hole no one would want to go down.
The chancellor has already launched a review of capital gains tax, and let’s face it, rarely does a review result in lower taxes rather than higher.
There are also mumblings about inheritance tax being increased, quite possibly through the removal of some of the reliefs that people take advantage of as mooted by the All Party Parliamentary Group last year.
Yet in his mini-Budget this month, Mr Sunak failed to mention IHT at all, preferring instead to focus on job creation and moves to get the economy heading in the right direction, such as the ‘Eat Out to Help Out’ restaurant money-off voucher scheme.
So, there is no question the government is moving headlong towards trying to recoup some of the money it has spent propping up businesses and the economy during Covid-19, a move not unexpected but potentially concerning for the businesses who needed to get the help when it was offered.
My fear, as with so many things we have seen before, is that an overly heavy-handed approach to checking for fraudulent claims by HMRC could catch as many – if not more – people and businesses who have made genuine mistakes and put them through the ringer as those who have set out to rob the exchequer.
The one thing all advisers can do for clients now is help them to ensure they have everything ship-shape when it comes to their grants, loans or handouts, just in case.
Alison Steed is a freelance journalist
